In a turn of events that brings some relief to healthcare consumers, approximately 43,000 former patients of Santa Clara Valley Healthcare in California could potentially receive bill corrections and refunds. This comes as the health system, which incorporates a network of primary and specialty clinics as well as three acute care hospitals including Santa Clara Valley Medical Center, the largest public hospital in the state, started informing patients about their eligibility for these corrections and refunds this week.
The patient outreach initiative was introduced as a result of a lawsuit filed against Santa Clara County in 2019 and settled in June 2023. The suit alleged that Santa Clara Valley Medical Center failed to adequately inform patients about its programs for charity care, referring to free or discounted care provided to low-income patients who don’t qualify for third-party payer programs like Medicaid or Medicare. Consequently, many patients were sent to collections between 2013 and 2017 for bills that ranged from $8,000 to $35,000, according to the lawsuit.
As part of the settlement, Santa Clara County has committed to broad reforms, including sending letters of notification to patients whose bills were sent to collections between October 28, 2018, to December 31, 2021. These letters will inform them that their bills can be re-evaluated for full discounts, partial discounts, or refund eligibility. After receiving the letter, patients have 65 days to confirm their interest in a bill correction, followed by another 150 days to complete their application.
Further, the county has pledged to improve its internal procedures to guarantee that patients are made aware of its charity care programs and how they can apply for discounted care. Efforts have already begun to facilitate this, with informational notices being sent to patients who may be eligible for charity care. These notices are expected to be handed to patients during their hospital stay or sent shortly after their discharge.
The improvements also include assistance with payment aid forms and applications for state-sponsored health insurance, such as Medi-Cal. It’s important to note that these measures allow patients to apply for financial assistance at any point during the collection process. In a statement, Paul Lorenz, CEO of Santa Clara Valley Healthcare, expressed optimism that these new outreach efforts, in conjunction with existing programs and recent state-initiated efforts, would enhance service provision, particularly to those most disadvantaged.
It’s worth noting that California mandates all its acute hospitals to provide charity care. In 2020, Santa Clara County’s board approved a program offering free care to hospital patients whose annual household income is at or below 400% of the federal poverty line, and significantly discounted payments for those with incomes between 401% and 650% of the poverty line.